Federal Stafford Loans

What is a Stafford Student Loan?

A Federal Stafford Loan is a low interest rate loan made to a student enrolled at least half-time (6 hours of enrollment per semester) in a degree seeking program. The loan is borrowed from a bank, and it is insured by the bank's guarantee agency.

Two types of Stafford Loans available

There are two types of Stafford Student Loans. A student is eligible for a Subsidized Stafford Loan if he/she shows financial need as determined by the results of the Free Application for Federal Student Aid (FAFSA) and other aid sources received. The federal government pays the interest on a Subsidized Stafford Loan while the student is enrolled in school.

For a student who doesn't show financial need, he/she may be eligible for an Unsubsidized Stafford Student Loan. With this loan, the student is responsible for interest that accrues while he/she is in school.

A student will be awarded any subsidized eligibility he/she has first. After that the Financial Aid Office will award any unsubsidized eligibility that may remain.

How much can a student borrow each year effective July 1, 2008?

	Subsidized Amount	Additional Unsubsidized*	Supplemental Unsubsidized	Annual Maximum
Dependent undergraduates
		Loans first disbursed 7/1/08
First year	$3,500	$2,000	$ -	$5,500
Second year	$4,500	$2,000	$ -	$6,500
Third year and beyond	$5,500	$2,000	$ -	$7,500

Undergrad Certification Programs	$5,500	$ -	Reduced to $6,000	$11,500
Graduate Certification Programs	$5,500	$ -	$7,000	$12,500

Graduate Programs

$8,500

$ -

$12,000

$20,500

Aggregate Limits (The maximum a student can borrow):

Dependent Undergraduates	$23,000	$2,000 per year		$31,000
Independent Undergraduates	$23,000	$2,000 per year	Not to exceed aggregate	$57,500
Independent or dependent undergrad whose parents are unable to borrow PLUS	$23,000	$2,000 per year	Not to exceed aggregate	$57,500
Graduate	$65,500		Not to exceed aggregate	$138,500

What are the terms of a Stafford Student Loan?

Amount:	Subsidized: Up to $3,500 Freshman, $4,500 Sophomore, $5,500 Junior and Senior, $8,500 Graduate. Unsubsidized: See chart above
Interest:	6.00% fixed (subsidized stafford loan interest rate is valid July 1, 2008 through June 30, 2009) 6.80% fixed (unsubsidized stafford loan interest rate that is valid July 1, 2008 through June 30, 2009)
Term:	10 years.
Fees:	Origination: up to 3%. Insurance: up to 1%.
Deferral:	Subsidized Stafford - Principal and interest. Unsubsidized Stafford - Principal. Interest begins accruing when funds are disbursed to the school. The interest accrues on the Federal Unsubsidized Stafford Loan during a student’s entire academic career.

What are the steps for receiving a Federal Stafford Loan?

1. Complete the Free Application for Federal Student Aid

(FAFSA).

You can complete the application at www.fafsa.ed.gov.

(Lander's Title IV Code - 003435)

2. Accept the Federal Stafford Loan on your
Bearcat web account .

3. Complete the Stafford Loan Entrance Counseling.

First-time Stafford Loan Borrowers at Lander

University must complete an Online Stafford Loan
Entrance Counseling Session

4. Select a lender.

Lander University is committed to offering a variety of options to help students and their families meet their college expenses. As a service, Lander University has done the research necessary to identify several reputable lenders that provide among the best rates, service, and convenience for our students. Lander will certify a loan with ANY lender you choose. Students are not required to use any of the lenders on our list and will suffer no penalty for choosing a lender that is not. Lander receives no incentive or financial benefit from any lender whether or not they are designated as recommended.

Annually lenders are evaluated on the criteria below. Product, services and processes play an equal role in our evaluation. Lander requests extensive and detailed information from lenders and also uses a report card to assess lender performance. To be selected as a recommended lender, the financial institution must provide the following to Lander students:

A competitive set of products and rates with no hidden fees.
Assurance that all advertised benefits will continue for the borrower even if the lender sells the loan to another financial institution. (As of this printing, these lenders have confirmed that loans processed through the lender codes listed herein will not be sold to another unaffiliated lending institution.)
Excellent service and toll free customer service numbers.
Quick response to the needs of Lander students.
Direct contact to lender representatives to quickly resolve loan issues.
Full electronic processing of loans including electronic transfer of funds.

Borrower benefits for the lenders are available at the link

provided. Students can also e-sign their Stafford Loan

MPN using their FAFSA PIN.

Lander University Recommended Lender List for Federal Stafford Loans is listed below. Lenders with Zero Fees are listed first. Lenders that charge an Origination Fee of up to 3% are listed in alphabetical order.

5. Complete the Federal Stafford Loan Master

Promissory Note (MPN).

Submit the MPN promptly to your lender. Allow

at least two weeks prior to your payment deadline

to allow ample time for your loan to be processed

and approved. A signed MPN is required only once

and remains valid for up to 10 years.